Mexico’s peso has had an assorted history against the US dollar. Periods of stability have been followed by periods of great turmoil —and resulting devaluations— followed by rallies and stabilization.
An irony —economists would say corollary— is that the only times the peso has gone through periods of appreciation against the dollar has been in the decades when it was allowed to float freely, with no exchange controls in place, few or no price controls in the domestic market, and no restrictions on withdrawing capital or profits.
From controlled exchange rates to free-floating currency
Over the last seven decades or so, different governments have applied different measures for managing the peso’s exchange rate, depending on their perception of the country’s needs at the time.
From 1954 to 1976, the Mexican peso was held at a fixed rate of 12.50 (old pesos) to the US dollar.
A devaluation in 1976 was followed by a long period of different exchange controls which included outright restrictions at times, multiple rates at others, and a system of ‘exchange rate bands’ that allowed a steady but gradual depreciation of the currency.
A continuing series of devaluations through the late 1970s and 1980s —some major, some controlled— culminated in an economic blowout in December 1994, when the country’s reserves became depleted following a year of capital flight, and that led to a free-floating exchange rate that has been maintained ever since, with the central bank only intervening in times of distress in markets.
Mexico’s peso from the late 1990s to 2010
After briefly reaching 11.50 to the dollar in the late 1990s, the peso had several years of ups and downs, gaining to less than 10 to the dollar just before the global economic crisis of 2008. Since that crisis originated in the US, its effect on Mexico was much greater than it was on other countries which have fewer (or smaller) trade and investment ties.
The currency’s value buckled in August of 2008, falling from 10 to more than 15 pesos per dollar in March of 2009, as investors sold Mexican stocks and bonds, often for cash to change back to dollars to meet other obligations.
The decade from 2010 to 2020
Mexico survived the 2008 crisis largely intact, and by October 2010 the peso recovered about half of its lost value, trading at around 12.50 to the dollar.
From 2011 to 2014, the currency stabilized and traded inside a range of 13 and 14 pesos to the dollar; but in late summer of 2014, the peso began to slide again, and in November of that year it broke the psychologically significant ‘20-to-1’ level.
The peso continued to weaken throughout 2015 and 2016 and, after briefly touching a new low of 21.50 in January 2017, the peso began a robust rally, and by September 2017 it was trading at around 17.60 on foreign exchange markets.
The currency then stabilized again and from 2018 to 2020 it traded in a range of 18 and 20 pesos to the US dollar.
Spring of 2020 through 2024
Soon after the World Health Organization declared Covid a pandemic on March 11, 2020, the Mexican peso began to experience a rapid decline in value against the US dollar—briefly touching 25 pesos by the end of March 2020.
However, in late spring the peso began to quickly recover its poise, and by November 2020 the currency stabilized again to trade in a range of between 19 and 20 pesos to the dollar—and remained remarkably stable in that range during the two difficult years that followed.
The Mexican peso rallied strongly in 2023 and got the term ‘Super Peso’ trending on social media in response to the currency’s strength, although a weak US dollar is also contributing to the peso’s recent gains.
Mexico’s peso gained 15% against dollar by the end of 2023, with an average rate for the year of 17.74 pesos to the US dollar—the strongest the currency has been since 2015. It has held those gains through the start of 2024, trading at or around 17 pesos to the dollar.
Latest Mexican peso prices and historical data
This page on Yahoo finance shows the latest market price of the Mexican peso vs the US dollar, and charts with historical data going back 20 years.
This chart on Macrotrends shows data going back to 1994. Choose “all years” on the chart options.
Predictions for the future value of Mexico’s peso
There are varying views on whether the peso is over- or under-valued at the present exchange rate. Different economists, including those at the Bank of Mexico, use different criteria to calculate what they believe a currency’s fair value ought to be, and therefore come up with different results and publish those estimates accordingly.
As we mentioned in the 2024 peso commentary article, economists are predicting that the peso will weaken again; but the simple truth of the matter is that no one can foretell its future value with any meaningful degree of precision—and a glance back at previous years’ estimates by the same groups of ‘experts’ confirms that.
Understanding currency pairs
Most of the peso trading is done against the US dollar, and rates vis-à-vis other currencies such as the British pound, the Canadian dollar or the euro, are simply a combination of the two rates, or “currency pairs” as they are known in the trading world.
Thus, if the Canadian dollar rises relative to the US dollar, it would also be more expensive to buy Canadian dollars with pesos, unless the peso had also risen against the US dollar. There are no fixed rules about that. Sometimes the peso can appreciate while others depreciate against the US currency, other times they will move in the same direction. It can depend on many different things. Occasionally the reasons for the change are local, and other times they are global.
Learn more about money and currency in Mexico
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The thing of peso is been trading good against dollar but if you compare the gold vs peso it has been falling. The U.S. didn’t get soft landing they lie. Mexico can’t hold no more us debt Mexican banks need to dump dollar and trade oil like Russia. The bad news is stagflation won’t go, fiat currency will plunge and we will suffer.
All that hard work and to slide down in 1 day………
Bad news co ing….
It looks like the thieves of Mexico, (The president and The bank of Mexico) are going to continue to lie and steal from the Mexican people. They Know more than J.P Morgan and Sachs. They can’t help themselves the money looks so good to them. The peso is being overvalued at the expense of the Mexican people. This is how you run a country? It is at $17.10 to $1 today and still going down. These theft are still trying to say they know more than anyone. He is like another president of Mexico years ago. The people were looking in one direction and he stole in the other direction. When he finished he left the country with the people’s money. The difference is, this president is afraid to leave the country out of fear not being able to return. Don’t believe me, when was the last time he left Mexico? If you believe this guy, I want sell you a little bridge, called the Brooklyn bridge.